Louisiana House Bill HB84

Louisiana 2016 1st Special Session

• Introduced: 2/18/16
• Refer: 2/18/16
• Refer: 2/24/16

Caption

(Constitutional Amendment) Removes the prohibition against levying a state sales and use tax on the sale of gasoline (Item #36) (EG +$90,800,000 GF RV See Note)

Impact

If passed, HB 84 would fundamentally alter the funding structure for transportation in Louisiana. Currently, all state taxes on gasoline and motor fuels are placed into the Transportation Trust Fund, with the absence of a sales tax limiting overall revenue potential. By lifting the prohibition on sales taxes, the bill could generate substantial funds—estimated around $90,800,000 annually—for critical transportation needs. The revenue could be directed to various essential services, ensuring better infrastructure and improved safety standards on state roads.

Summary

House Bill 84 is a proposed constitutional amendment that seeks to amend Article VII, Section 27(A) of the Louisiana Constitution to allow the state to impose a sales tax on the retail sale of motor fuels, notably gasoline, which is currently prohibited. The bill generates considerable attention as it seeks to change how the state generates revenue for transportation infrastructure, including the construction and maintenance of roads, bridges, and other related projects. By allowing a sales tax on gasoline, the bill aims to enhance the funding for the Transportation Trust Fund, which supports various transportation initiatives throughout the state.

Sentiment

The sentiment surrounding HB 84 is mixed, reflecting a division among stakeholders. Proponents argue that the bill is necessary for addressing the deteriorating condition of state roads and bridges, citing the urgent need for additional funding sources. They believe that a sales tax could provide a stable revenue stream that aligns with increasing costs associated with road maintenance. Conversely, opponents express concern that imposing a sales tax on gasoline could disproportionately affect lower-income residents and that it may complicate the already burdensome tax landscape for the public. This creates a complex dialogue surrounding fairness and fiscal responsibility in state governance.

Contention

Notable points of contention include the potential economic burden on consumers and the efficacy of relying on sales taxes as a stable funding mechanism. Critics argue that this could mean rising costs for everyday drivers, particularly as gas prices fluctuate. Additionally, the debate encapsulates broader issues regarding state versus local control of taxation and whether such a substantial change should be decided at the ballot box by the electorate, thereby emphasizing the need for transparency and comprehensive public discussion regarding the implications of taxing motor fuels.